Banner Health’s Supply Chain Services team shares mindsets, milestones that motivate success within their enterprise

July 26, 2021

Two Supply Chain leaders from Phoenix-based Banner Health – Doug Bowen, Vice President, Supply Chain Services, and Paul Oppat, Executive Director, Supply Chain – shared with Healthcare Purchasing News Senior Editor Rick Dana Barlow their team’s attitudes and motivations behind what, how and why they do what they do with valuable insights on what helps them succeed.

HPN: What’s the secret formula that makes a leader in supply chain management? How does your department implement that secret formula?

BOWEN: This is what I have learned over the years: The secret formula is to accept the fact that there is no secret formula! There is no silver bullet! Leaders are made over time. There is no single event that makes a leader. It is consistency and an accumulation of experiences over time.

Leadership is not a position. Anyone can be a leader. It is about building character and integrity. Leadership is about service, and servant leadership is a key.

The Leadership Paradox: Leadership is NOT about you. Teamwork is the key. Leadership is a team sport. However, at the same time, leadership is ONLY about you. Each person must get better in order for the team to get better.

Leaders love their job! Working hard for something we don’t care about is just stressful, but working hard for something we love creates passion, and that passion can change the world for the better!

Leaders have a bias for action. They spend less time creating strategy and more time executing the strategy.

OPPAT: Leaders focus on finding and developing great people. We practice a “one supply chain” mentality that unifies our efforts to focus on our supply chain “triple aim” of reducing the cost of care, improving the experience of care and improving population health.

Leaders are only as good as those people on his/her team and only as good as those he/she works with inside and outside of the organization. A leader is one that can motivate others and be comfortable with delegating responsibility.

The next big trend in healthcare supply chain management will be...[fill in the blank]. Why?

OPPAT: An increased emphasis on independent resiliency and preparedness for supply chain disruption and unexpected events.

Supply chain data and transparency. Work has been underway, but both suppliers and providers must work faster to achieve cleaner, more transparent data. By establishing master data management as a core competency, we are able to know what supplies we have, how we are using them and where we need to pivot in the event of unexpected supply chain disruptions.

Managing the Total Cost of Ownership for new technologies. New tech is coming fast and furious, and we need to be able to manage its implementation and its appropriate utilization.

Some in the “C-suite” have criticized supply chain managers for being too technical and not strategic enough to “join their club.” Do you agree? How might supply chain’s pandemic response contribute to the viewpoint(s)? Why?

BOWEN: The reality is some supply chain managers are too technical and not strategic enough to be included in the C-suite. However, there is an ever-growing number of supply chain managers that are elevating themselves from supply chain managers to supply chain leaders.

These supply chain leaders are proving their worth by impacting not only cost, but also quality and outcomes – the three most important factors that drive the healthcare business. This overall ability to improve the business of healthcare will get them invited to join the club.

In the past, the supply chain was known for only cost outcomes. However, the Supply Chain’s excellent performance in the pandemic response has created a platform to showcase the little-known truth that supply chain also directly impacts the quality of patient care every day.

How can consulting firms, distributors and GPOs contribute to the performance of your internal supply chain management expertise without overshadowing the department or usurping control?

BOWEN: At the beginning of any engagement, the parties should work together to define “the box.” We will all work together to enlarge the box and include everyone in the box, but when anyone steps outside of the box, we can all hold them accountable to get back into the box. Enlarging the box allows all team members to work together toward achieving the common desired goal. A clear understanding from the beginning that credit will be given to all parties involved promotes faster achievement and better teamwork. Using a RACI Chart can help clarify everyone’s role in an engagement: R-Responsible, A-Accountable, C-Consult, I-Inform.

What specific project did your department complete where you felt they exceeded your expectations?

OPPAT: I am hesitant to call-out any specific project as so many team members made outstanding contributions to a countless number of projects that exceeded my expectations.

Reflecting on our team’s response to the pandemic, I recall countless examples where individuals came together to work urgently and passionately to save as many lives as possible. A common theme was the spirit of “one supply chain,” and a genuine desire to make a difference at an individual level. Our team members embraced the need to work beyond their comfort zone, make important decisions quickly, and communicate essential information early and often. Volunteerism was widespread, with individuals seeking opportunities to contribute in unexpected ways, including volunteering to work in a variety of other departments that were overwhelmed during the pandemic surges.

This wonderful demonstration of esprit de corps reinforces my commitment to linking the organization’s mission to the hearts and minds of our team members. When we as individuals genuinely believe in the mission, and understand our role in it, the result is a high performing team that can rise to any challenge.

In your opinion, what is your department’s toughest administrative challenge? How might you solve it?

OPPAT: Administratively, we have two challenges. As the organization grows, labor and technology resources for supply chain management remain relatively fixed. Our challenge is to continually find ways to be more efficient to accommodate that growth.

What is your department’s toughest operational challenge? How might you solve it?

OPPAT: Communication. We do a good job in this space, but in a large and complex organization it is challenging to get your message to everyone that needs to understand your mission, vision and values. We continually explore new venues, technologies and media to engage our team and customer stakeholders.

What are your top three priorities for the remainder of 2021 and for 2022?

BOWEN: Banner Supply Chain Services is working to:

Diversify supply sources

Optimize internal processes

Harness the power of data

Priority #1: Diversify Supply Sources. We are working to diversify our supplier base – both abroad and here at home – to mitigate risk and help ensure timely product access. A vital component to success in this effort was the groundwork we’d laid years prior to diversify sourcing strategies, including direct-to-manufacturer and forward-buy activities. Eliminating unnecessary middlemen, like brokers and importers, and working directly with untapped, global producers gave us greater efficiencies and reduced lead time for hard-to-source products.

While global direct sourcing is one cornerstone of Banner’s strategy to diversify its supply chain, so is investing in greater U.S. manufacturing capacity. To help reduce overreliance on other parts of the globe, we realized early on that we needed to boost domestic production of essential medical gear.

To help meet this goal, Banner and 15 other leading health systems invested in Prestige Ameritech, a Texas-based producer of N95 face masks. With this investment, Prestige is now providing more than 60 million U.S.-made N95s, surgical masks and goggles per year for Banner and other participating Premier members.

Priority #2: Optimize Internal Processes. We further reduced risk with an investment and focus on distribution and inventory management as well as supply conservation measures. We started looking for ways to streamline our distribution and opened Banner Health’s Consolidated Service Center and Distribution Warehouse in 2004. With more than 200,000 square feet and capacity for 7,200 pallets, our warehouse is centrally located to serve all our facilities in Arizona and allows our team to maximize storage and efficiencies.

Alongside this advanced inventory control, the Banner team recognizes that a clinically integrated supply chain is necessary to thrive in today’s healthcare environment. Via Banner’s direct sourcing partnerships, for instance, all products come from validated and inspected suppliers and are designed to the Banner team’s clinical standards at the lowest price point available.

The benefits of the clinical integration in the Banner supply chain:

Drives supply requirements and helps limit waste

Ensures all products are held to the highest safety and clinical standards

Gives Banner clinicians access to high-quality products at the right price and affords them more time to focus on patient care

In addition, the Banner supply chain team, together with its providers and frontline workers, made PPE conservation a key priority to protect against COVID-related supply shortages. We encourage all of our team members to follow CDC-recommended PPE conservation protocols and be judicious in their use of supplies to protect our clinicians, employees and patients.

Priority #3: Harness the Power of Data. Underpinning its holistic supply chain strategy, Banner is leveraging technology to better understand risk, provide greater visibility and support continuous operational transformation. During COVID-19, for example, Banner’s supply chain technology enabled Banner with the ability to better plan and allocate supplies, as well as fast-track critical products via expedited sourcing agreements.

Many supply chains ─ both in and out of healthcare ─ still rely on disconnected data sets and outdated, manual processes. At Banner, we’re committed to building integrated digital supply networks that can anticipate and respond to future surprises in the supply chain, minimize their impact and position us for operational success. Technology enablement is the key to a modern, effective and resilient supply chain.

We continue to do everything we can to protect our healthcare workers while they care for our communities. Creative partnerships, innovative sourcing and distribution strategies, conservation measures and technology can lower barriers to entry and drive stable supply. These actions are imperative to eliminate vulnerabilities and ensure greater supply chain resiliency through this pandemic – and beyond.

How does the CEO view your department? Does he or she see it as a strategic function or a support service? What resources can the department count on and will they come every year – and not just in response to clinician complaints?

BOWEN: The CEO, Peter Fine, is fully engaged and supportive that the supply chain is a strategic function. Peter has encouraged the supply chain to “plan the work and work the plan” to achieve industry leadership using a strategic plan that was created 20 years ago! No, that is not a typo. Yes, I said 20 years ago. Most people would say a 20-year strategic plan is preposterous. However, it is not bizarre; it is brilliant. This is a specific example of spending less time creating a strategy, and more time executing the strategy. The key learning here is that success in healthcare does not take years; it takes decades of consistent, dedicated and purposeful work.

What are some practical, common sense ways that supply chain managers can keep patient satisfaction in mind as they’re performing their duties?

PPAT: In Supply Chain Services, we are focused on “caring for the caregiver.” When the caregiver has what they need to do their job well, our patients enjoy a better experience and have better outcomes. It is a simple message that everyone can support.

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